518-373-4111
Q: I know that under the Affordable Care Act we need to give new hires a Notice of Exchanges and Subsidies. Are we required to have the employees sign something to prove they got this notice? What is the penalty if we do not have this documentation?
A: There is no requirement to have employees sign an acknowledgement of receipt or to otherwise document the distribution of the Notice of Exchanges and Subsidies form. Getting a signature to confirm receipt is unnecessary and could actually create more liability for you. Employees are not always good at returning documents, and if your files were audited it would appear that those who had not returned the acknowledgement had not received the notice. For this reason, we generally recommend against requiring a signed acknowledgement for this notice.
We do, however, recommend that you either keep a log of who has received the notice or have a check box on your new hire checklist to indicate that the notice was given to the new employee. Again, this is not required, but it is an easy way to make your record more complete in case it ever was questioned.
Regarding penalties, as there is no documentation requirement, there is no penalty for not documenting Notice of Exchanges and Subsidies distribution. At this time, there is not even a penalty for failure to distribute the notices. However, you should continue to give the notices to new hires within 14 days of their start date (and to existing employees if you have not yet) so that you will be in compliance if a penalty system is implemented in the future.
You can download the two model Notice of Exchanges and Subsidies forms here – there is one for employers who currently offer health insurance to their employees, and one for those that do not offer coverage.
GTM will continue to monitor all Affordable Care Act updates and information, including keeping our clients compliant with new reporting requirements that begin in 2016.
Please contact us at (518) 373-4111 for more information.
